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Iran urges for $200-billion investment to develop oil industry

Iran's Oil Minister Bijan Namdar Zanganeh has called for $200 billion of investment for development of country's oil industry, Shana news agency reported.

The minister said that Iran doesn't have enough of domestic sources to develop the oil industry, thus foreign investment is needed.

The new model of oil contracts (IPC) is aimed at attracting foreign investment, he said at a press conference in Tehran.

According to Zanganeh, Iranian oil industry's upstream projects need $130 billion of investment while the downstream projects demand $70 billion to be developed.

He further added that several regional countries have taken measures to discourage foreign investors from investing in Iran.

Last November, Tehran hosted 137 companies from 45 countries for a two-day conference, during which legal generalities of the IPC were introduced and it was announced that more details about the contracts would be unveiled during a conference likely to be held in London in February 2016.

However, on Jan. 30 Iran announced that the country has decided to cancel the London conference due to "problems for issuing UK visa".

Prior to the scheduled London conference, a group of Iranian conservatives protested against the IPC suggesting the new model of the oil contract is against the Iranian constitution.

The IPC is a framework that lays out the basic structure - and some details - regarding all future petroleum contracts in Iran. It was earlier announced that the country plans to boost oil production to 5.7 million barrels a day and gas output to 1.4 billion cubic meters a day by 2021.

Iran's current oil production is estimated to be around 2.8 million barrels per day of which about one million barrels are exported.